WHITE HOUSE — President Barack Obama has marked the fifth anniversary of the U.S. financial crisis. He claims credit for major progress in the recovery from near collapse five years ago, but says more work lies ahead.
An economy shedding hundreds of thousands of jobs, banks saddled with worthless subprime mortages, millions losing their homes, and an auto industry near collapse -- It was a downward spiral that began on September 15, 2008 with the bankruptcy and collapse of Lehman Brothers, followed by bailouts for other financial firms considered too big to fail.
And that led to the worst recession since the Great Depression.
When Obama took office in January 2009, the financial system itself was near collapse.
He spent much of his first term implementing a stimulus passed by Congress and bailing out the struggling auto industry. On Monday, he reviewed the past.
"We put people to work repairing roads and bridges, to keep teachers in our classrooms, our first responders on the streets," he said. "We helped responsible homeowners modify their mortgages so more of them could keep their homes. We helped jump-start the flow of credit to help more small businesses keep their doors open. We saved the American auto industry."
Other steps included cutting middle class and small business taxes, financial system reform, and establishing a Consumer Financial Protection Bureau.
But the U.S. economy continues to face challenges.
Obama pointed to a growing income gap.
"Even though businesses are creating new jobs, and have broken record profits, the top one percent of Americans took home 20 percent of the nation's income last year, while the average worker isn't seeing a raise at all," he said. "In fact, that understates the problem. Most of the gains have gone to the top one tenth of one percent."
Republican opponents in Congress rejected much of the president’s proposals for new stimulus and tax reform.
The negative political atmosphere in Washington, with a divided Congress, promises more conflict.
Republicans are threatening to defund Obama's signature healthcare law which could trigger a government shutdown, and a new battle looms over raising the government’s debt limit, something Obama says is non-negotiable. He claims the Republicans’ budget priorities would place the economy at risk.
He said, "Are some of these folks really so beholden to one extreme wing of their party that they are willing to tank the entire economy, just because they can't get their way on this issue? Are they really willing to hurt people just to score political points?"
The government runs out of spending authority on September 30. Obama will continue his focus on the economy. Congress will spend the next two weeks trying to hammer out a new budget.